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Charitable Fundraising as an End Run Around Ethics Laws

Tuesday, March 13th, 2007

Robert Wechsler

Lobbyists, lawmakers, and charitable fundraising form a triangle that is both virtuous and harmful.

Community leaders like to be identified with charitable groups, and charitable groups like to be identified with community leaders. It's a natural combination. But what is not natural, or even easy to see, is the line between charitable fundraising and campaign fundraising, when lobbyists, contractors, and developers enter into the picture.

The typical problem involves a mayor's favorite charity. When a mayor has a favorite charity, people who want the mayor to feel favorable to them not only give money to his or her election campaign, but also to the charity, thus effectively going beyond legal limits on campaign contributions and, since they are not campaign contributions, coming close to bribery. But since it is a good cause, whatever it is, anyone pointing a figure looks pretty rotten: Why would anyone take food from the mouths of children just because of some ethics technicality?

Actually, it's the officials who bring up the technicalities, and they are extremely creative in using fundraising as a technically legal way to get around restrictions or to use their position to get something not for themselves directly, but for a cause that has special meaning for themselves (and, because it is identified with them, improves their image in the community).

Maryland legislators have been especially creative with their Legislative Follies. According to an article in the Baltimore Sun, this 30-year General Assembly tradition of sketches by legislators used to be run by the legislators, but since lobbyists would buy lots of tickets, it was turned over to a panel of former legislators. However, three of the board members happen to be ... yes ... lobbyists themselves.

State law prohibits lobbyists from engaging 'in any charitable fundraising activity at the request of an official or employee.' One former legislator and current lobbyist (and vice chair of the scholarship fund that receives proceeds from the event) collected ticket money for the event, but insisted that he did not break the law because (1) he did not actually sell any tickets and (2) no elected official asked him to raise funds.

Counsel to the Joint Committee on Legislative Ethics stated disingenuously, 'I don't think that this situation is a violation of the letter or the spirit or the intent of the law. Lobbyists selling tickets to legislators is not the same as legislators selling tickets to lobbyists.' When it comes to the perception that legislators are in bed with lobbyists, does it really matter which side of the bed they sleep on? It's still a matter of lobbyists doing things for legislators, helping their charity, running their little show, putting legislators further in their debt. That is the spirit and intent of laws limiting lobbyists from engaging in officials' charitable activities.

The Maryland Ethics Commission chair noted the merits of the event's purpose, but added 'I think it would be best handled by an independent commission or board of non-lobbyists and persons not doing business with the state of Maryland.' Once again, government lawyers focus on the legal technicalities of sleeping positions, while ethics people focus on independent boards that keep them out of bed altogether.

In Connecticut, state law allows lobbyists to give money to charities, even when the fundraiser is an elected official, as long as it does not directly affect the official's salary. This allows, for example, the speaker of the House to work as a charity fundraiser. Everyone's happy: the charity, the lobbyists, and the speaker. Well, almost everyone: the public doesn't do too well out of it.

According to a column in the New Haven Register, the state's Office of State Ethics has submitted legislation to change this, so that lawmakers may not fundraise to benefit their employers, even if the officials do not directly benefit.

These are state situations. As I mentioned above in the example of mayors' favorite charities, the same sort of thing happens locally, but usually with no laws preventing elected officials from using their position not only to help people, but also to help their personal charities in ways people without their position of power cannot do. It is a misuse of office, but it is a difficult one to deal with in a municipal ethics code or to get passed over objections of hurting local charities.

Does anyone know of good language that works? Or bad language that doesn't work?

Comments

Robert Wechsler says:

Sometimes there is confusion about what is wrong with officials doing solicitation for charities. For example, according to an article in the South Florida Sun-Sentinel (registration required), Ft. Lauderdale is considering a ban on solicitations done on city stationery or using city resources.

Many cities' ethics codes or personnel rules do not allow the use of city stationery or resources for anything other than city business. Extending this to charitable solicitations does not deal with the conflict or abuse of office problem, by which officials use their office to get help from people and businesses that could not otherwise give them campaign contributions.

The Ft. Lauderdale mayor wanted an outright ban, with fines for violations, but he had the support of only one other member of the city commission.

According to another article, the mayor's name and seal went out on a solicitation for his pet charity, Sister Cities, last week. He said that if the ban he wants were to be passed, his name would not be on the next solicitation.

An interesting exchange between the mayor's only supporter on this issue and the vice-mayor. The vice-mayor said that nonprofits ask for help and ask her to sit on fundraising committees. The commissioner in favor of a ban on solicitations replied, "Well, why do you think that is? Why do they want you to be on those things? Is it because you're so great and wonderful?"